The Impact of Guaranteed Income on Recipients
A recent study on basic income, funded by Open artificial intelligence Founder Sam Altman, revealed interesting findings about the effects of giving low-income earners a guaranteed payday with no strings attached. The study, one of the largest and most comprehensive of its kind, examined the impact of guaranteed income on recipients’ health, spending, employment, ability to move, and other aspects of their lives. Altman first announced his desire to fund the research in a 2016 blog post on the website of startup accelerator Y Combinator.
Behavioral Changes and Work Hours
The study looked at how people behaved when given free cash and whether it affected their work habits. Some questions addressed were, “Do people sit around and play video games, or create new things? Are people happy and content?” Altman, who believes that technology may eliminate traditional jobs in the future, sees universal basic income as a potential solution. In OpenResearch’s Unconditional Cash Study, 3,000 participants in Illinois and Texas received $1,000 per month for three years, while a control group of 2,000 participants received monthly donations of $50. The study found that those who received basic income worked slightly fewer hours per week, opting for more leisure time.
Autonomy, Well-Being, and Employment Quality
Eva Vivalt, an assistant professor of economics at the University of Toronto and one of the study’s lead researchers, noted a slight decline in labor supply among cash transfer recipients. However, she sees this as a positive outcome, as it gives people more autonomy and the opportunity to improve their well-being by choosing how to spend their time. While the researchers expected participants to eventually earn higher wages by taking better jobs, this did not materialize. There was no significant impact on employment quality, despite the increased leisure time for recipients.
Healthcare Spending and Future Studies
The study also revealed that basic income recipients increased their spending on healthcare services, with higher rates of hospitalizations and emergency room visits compared to the control group. The researchers plan to continue studying the experimental results as other cities in the USA consider conducting their own tests of the concept. The findings shed light on the potential benefits and challenges of implementing a guaranteed income system for low-income earners.
